DEEPAK KUMAR KANJIBHAI PATEL,MUMBAI vs. ITO 24(1)(5), MUMBAI

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ITA 2743/MUM/2017Status: DisposedITAT Mumbai24 September 2018AY 2010-113 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that penalty for non-compliance should be imposed judiciously, considering all circumstances. Since the assessee had a reasonable cause for non-appearance and later provided all details, the penalty was deleted.

What were the facts?

The assessee appealed against a penalty imposed under Section 271(1)(b) for non-compliance with AO's notices. The assessee was not in town and subsequently provided all required details, leading to the completion of assessment under Section 143(3).

What were the issues?

Whether penalty under Section 271(1)(b) is leviable for non-compliance with notices when there is a reasonable cause and subsequent compliance.

Which sections of the Income-tax Act were involved?

Section 271(1)(b),Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “D”, BENCH MUMBAI

Before: SHRI R.C.SHARMA, AM & SHRI RAM LAL NEGI, JM Shri

For Respondent: Shri E. Sridhar
Hearing: 19/09/2018Pronounced: 24/09/2018

आदेश / O R D E R PER R.C.SHARMA (A.M):

1.

This is an appeal filed by the assessee against the order of CIT(A)- 36, Mumbai dated 17/01/2017 for A.Y.2010-11 in the matter of imposition of penalty u/s.271(1)(b) of the Income Tax Act/ 2. Nobody appeared on behalf of the assessee inspite of giving the opportunity. 3. We have heard learned DR and found that penalty of Rs.10,000/- was imposed by AO for non-compliance with the notices.

Shri Deepak Kumar Kanjibhai Patel 4. By the impugned order, CIT(A) confirmed the penalty imposed u/s.271(1)(b). Hon’ble Supreme Court in the case of Hindustan Steels (25 STC 211) observed that an order imposing penalty for failure to carry out a statutory obligation is the result of a-quasi-criminal proceeding, and penalty in defiance of law or was guilty of conduct contumacious or dishonest, or acted in conscious disregard of its obligation. Penalty will not also be imposed merely because it is lawful to do so. Whether penalty should be imposed for failure to perform a statutory obligation is a matter of discretion of the authority to be exercised judicially and on a consideration of all the relevant circumstances. Even if a minimum penalty is prescribed, the authority competent to impose the penalty will be justified in refusing to impose penalty, when there is a technical or venial breach of the provisions of the Act or where the breach flows from a bona fide belief that the offender is not liable to act in the manner prescribed by the statute.

5.

From the record we found that during the period, cases were fixed by the AO. Assessee was not in the town, hence he could not provide details and compilation of submission before the AO at the point of time. However, subsequently assessee has filed all the details and assessment order was also passed u/s.143(3) of the Act. Keeping in view the reasonable cause for non-appearing before the AO on the date of notice, we direct the AO to delete the penalty so imposed u/s.271(1)(b) if the IT Act.

Shri Deepak Kumar Kanjibhai Patel

6.

In the result, appeal of the assessee is allowed.

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